Is the Lyoness Loyalty Card program legitimate?

A:

Quick Answer

The Lyoness Loyalty Club has legitimately provided cash-back rewards to members on purchases with their shopping partner organizations since 2003. However, the company has been taken to court in Australia on the charge of being a pyramid scheme.

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In 2014 the Australian Competition and Consumer Commission took Lyoness to court, arguing that the program constituted a pyramid scheme and engaged in "referral selling," which is prohibited in that country. The case alleged that Lyoness induced members to recruit others by offering commissions if the new member places a down payment on future shopping. Lyoness has been investigated on similar charges in several other European countries, including Austria, where it is based.